Business owners make the choice to sell their company for retirement or to start a new venture. When setting up the sale, the broker needs explicit details about the company and what it owns. This includes all real estate, where it is located, and the value of each property. It includes the products on hand and any assets the company owns outright. This could include fleet trucks, commercial vans, machines, or other equipment. The owner must decide what they want to include in the sale of the business, and they must provide this information to the broker before listing the business for sale.
The Customer Roster
The sellers turn customer information over to the buyer after they take ownership of the company. Since the business will begin operations as the same organization, the servers and databases are included in the sale. The business owner must turn all the data over for immediate review and use. All passwords and login credentials for the data systems are given to the buyer. The purchasers have full access to information about all sales and customers. The information makes it easier for the new owner to complete sales and use data mining to collect data. Business owners can review what they want to include in the sale of their company at CGK Business Sales now.
Assets That Aren’t Needed to Operate the Business
The seller lists company assets under the company’s or the owner’s name. Any assets that are listed as belonging to the business are generally included in the sale. If the owner doesn’t want to sell an asset, they must follow steps for transferring ownership into their own name or the name of a new company. The transfers must take place before they place the business on the market. Typically, any asset owned by the business is added to the catalog of assets that’s presented to buyers. Asset protection strategies must be followed by the business owner ahead of time.
Machinery and Equipment
Machinery and equipment used to create company products come with the business, too. The exception is any equipment or machinery that has been inspected and presents a risk to workers. The faulty items must be replaced or removed from the property. The buyer can hire an inspector to assess all equipment and machinery for issues, and the findings give them leverage to negotiate a lower price or include updated machinery or equipment.
Contracts with Vendors or Suppliers
Vendors and suppliers secure contracts with business owners to sell their products and use their supplies. The contracts define if the business has a line of credit, when the company pays their invoices, and how many products or supplies the company orders at once. The buyer isn’t required to use the same vendors or supplies. However, if the company has an existing contract, the buyer may be obligated to use the services until the end of the contract.
Contracts with Business Partners
The buyers must fulfill existing contracts with business partners. The sales contract for the business must explain these obligations and how long the contract lasts. All terms are explained, and the buyer must consider if they want to get involved with the business partners. Prior to the sale, the business owner doesn’t have to disclose information about who their business partners are. Their obligation to the buyer is to explain the terms of all existing contracts. The buyer cannot end the contract when buying the business, and they must fulfill all terms as defined in these contracts.
Computers, Servers, Network Equipment
Computer systems, servers, and network equipment are generally included in the business sale. The buyer doesn’t have to leave the passwords as they are, and it would be recommended to change them. However, buying the equipment with the business saves the buyer upfront costs. The equipment is necessary for operating a business and helps the business owner keep their data organized, and it provides all workers a proper workstation to complete their work tasks each day. If the buyer doesn’t start from scratch, the company has a chance for immediate profits, and the buyer gets all advantages of purchasing an existing company.
Complete Product Inventory
Businesses provide a full list of all products they have on hand. The price list for the products is available for the buyer, and they can review the total number of each product at the business property. They disclose the total value of the products to the buyer since the products will become their property at the end of the sale. The business owner must explain how they sell the products to their customers and present sales records for all items. The details show the buyer what products are the most profitable and give them the best opportunity for generating fast profits.
Designs and Patents for Products
Designs and patents for products must be transferred to the buyer when they purchase the business. The only exception is if the products aren’t included as trademark products of the business. Some business owners may take patents and product designs with them when they start a new venture. If the product designs are no longer a part of the existing company, the business owner doesn’t have to transfer them to the buyer. However, any transfers must be listed in the sales contract to prevent confusion and legal disputes later.
Business owners take fast action when preparing to sell their company, and they must consider all assets owned by the company or associated with the company. Understanding how to sell a business guides the owner through the transaction and protects their interests. A broker manages the sale for the owner, but they need all documentation for the business, its assets, and products. Buyers will want to see all financial records for the business and review all profits and losses for at least the last three years. All assets, machinery, and equipment that comes with the company must be cataloged for the buyer with a valuation. Reviewing steps for selling a corporation helps owners avoid prevailing issues.